And did the whole thing... Made the icon and default picture... It works... Set the permissions to 755, the folder and the stuff in the folder... Went to open it up after respringing my ipod... Click icon, default picture comes up then crashes....

Does this not work with the 3.1.2 Ipt3g in 8gb?

Thanks for the help guys, if you want me to post the folder on [PIRACY.rs] or [PIRACY.mf]

Are you trying to make a app icon to link to a webpage in Safari? That video is old and for ipods from '07. There is an easier way do go about this:
1. Go to the site in safari
2. Tap the plus at the bottom
3. Tap "Add to Home Screen"
4. Once you have renamed the icon to somethin shorter, tap "Add" in the top, right hand corner.